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Episode 007: Shanna Skidmore - Avoiding Common Money Management Pitfalls (and how to price your services)
174 Plays7 years ago
Shanna Skidmore is a business strategist and financial coach. Nicknamed the “dream-releaser” by her clients, she helps entrepreneurs make money doing what they love by building profitable & sustainable businesses. For the past 12 years she has been immersed in the world of small business development and finance. By studying patterns of success, she now coaches and consults with creative entrepreneurs on business principles she found to be key indicators of success. Her background in finance, psychology, and art have allowed her to marry the world of business and creativity. Her greatest joy is watching others transform their stories and build businesses & lives they love!
For the show notes, go to https://daveyandkrista.com/btb-shanna-skidmore-episode-7/
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Transcript
Understanding Colleagues' Needs and Exploring Social Media
00:00:06
Speaker
This is different, right? I can't tell everybody what it is. But there are some things for me that was like, how can I get in the heads of the people I'm working with and if I can keep getting in their head and keep providing solutions, then I don't have to just be in their face all the time. I can just do good work and let the referrer, hopefully let the talk keep growing. So that's why I thought, I'm gonna go on social media and see what happens.
Introduction to Shanna Skidmore
00:00:35
Speaker
We help creative businesses find more clients and build their brands. I'm your host, Davy Jones.
00:00:43
Speaker
Today's guest is business strategist and financial coach Shanna Skidmore. Shanna helps entrepreneurs make money doing what they love by building profitable and sustainable businesses. She's even nicknamed the dream releaser by her clients. And her background in finance, psychology and art have allowed her to marry the worlds of business and creativity. Today, she's chatting with me about managing money, common money pitfalls and how to price your services.
00:01:15
Speaker
Welcome. Thank you so much for joining us on the show. Thank you. I am. I've been really excited for this interview. I know so many people that you've worked with and they all have just incredible things to say about you and the experience going through, you know, whatever it is, working with you personally or going through the blueprint model. And I want to talk about all of that later in the interview.
Challenges in Managing Money
00:01:38
Speaker
But I am so excited just to talk about money because I think we all get into business wanting to make money.
00:01:45
Speaker
But money can be difficult for all sorts of reasons. It can be hard to know when to save it, when to spend it, what to spend it on. It can be hard to have a healthy perspective on money, I think. And those are all things that you seem to tackle with people.
00:02:04
Speaker
Yeah, so I'm excited to dig into that and just talk about how people can develop a healthy perspective around money What they should be doing with their money when they first get started Just so that they can you know live that life that they set out to live in their dreams as they started their business Right. Absolutely. I'm so excited. Thanks for having me. I'm so honored to be here
00:02:26
Speaker
Yeah. Cool. Well, um, first I want to, I want to talk about your business, uh, to get started. How did you, how did you get into this? How did you start working with you? Because you work primarily with creative women and you have a background in finance.
Shanna's Academic Journey and Career Path
00:02:39
Speaker
And I also saw that you have a background in art as well. So how did you, how did you get into this industry starting to work with creative women? Yeah.
00:02:48
Speaker
Um, I stumbled into it really. Um, it's so funny how many people say that, you know, it's so funny how many people are like, yeah, I stumbled into it. Yeah. Yeah. I feel like, and I never set out to do, I mean, this is like the perfect career for me, but I didn't know that. Um, so quick background. I went to school for, I have a business finance degree and also psychology degree.
00:03:14
Speaker
And then I took every art class I ever could. So I almost have an art degree as well, but I didn't take art history, so I never completed the art degree. So I was like, who needs an art degree, right? That's so terrible. But I always say, like, I felt like such a misfit puzzle. I never really knew how finance and psychology and art came together into one thing. And so right after college, I started working in finance. I did that for five years. And I did personal and business financial planning,
00:03:41
Speaker
was a financial advisor for a fortune 100 company. So I got married and about probably three months after we got married, my husband who also worked in finance at the time, I was like, if you ever meet him, you'll know that's like not his personality to be like, let's talk about your money and sit down with people. Um, and so I was like, if you could do anything, what do you want to do? And he said, I want to design in both airplanes. And that led us down this five year path of him going back to school and
00:04:09
Speaker
We moved to Atlanta for him to do that. And so I left my financial career because finance is just like having probably like a photography business. Like you establish yourself oftentimes in a location and it can be challenging to move it. And so when I, when we moved to Atlanta, I was contacted by a venture capitalist firm. So like think like Shark Tank and it wasn't Shark Tank. That would have been cool. But it was another venture capitalist firm and they were working with a startup fashion designer in Atlanta. And so they needed somebody to come in.
00:04:39
Speaker
as the term controller, that fancy word, which is operations and finance. So that's what really got me into the creative world. And that was back in 2011. And I started seeing that there's this true breakdown, I feel like, in the world of finance and the world of creativity.
Bridging Finance and Creativity
00:04:56
Speaker
It's like this dichotomy, I guess. And there's no overlap. And oftentimes, most creative businesses are a lot of them started by women.
00:05:06
Speaker
There's a lot of intimidation there. And finance is a male-dominated industry. And so I think I just became a bridge builder, I feel like, between the world of finance and creativity. And I always say I'm really like a money therapist. So that's where the psychology comes in. So it's been really amazing. I'm so blessed and thankful for the way that the Lord blessed it. So now I've been doing that now, what, seven years. And so I was working one-on-one with clients. I started with a fashion designer.
00:05:34
Speaker
and went into floral design. And then it just started building. Now I've worked with virtual assistants, interior designers, every wedding industry you can ever think of, professional graphic design, brick and mortar stores, online shops. I mean, so it's been really cool to see how some simple financial teachings can really help my creative friends make money doing what they love. And I'm just so thankful to get to do that.
00:06:04
Speaker
Yeah, I would assume that even across the kinds of people that you work with, you probably see some common pitfalls. Because I think that really regardless of what you're doing, whether you're a floral designer, whether you're a photographer, whatever, you probably run into similar issues, especially when you're starting your business.
00:06:22
Speaker
And so many of us, my undergrad degree is in theology, and then I have a master's in multicultural education, which is, I feel like I've learned a ton from that, and I'm so thankful for those degrees and those experiences, because I don't think God wastes anything, but I don't have a background in finance. So dealing with that, dealing with taxes and things like that, it's overwhelming and intimidating to a certain extent.
00:06:49
Speaker
So going back to the beginning of your business, how did you, did you just find your first clients really based on word of mouth and when did you split off onto your own? Yeah, that's a great question. So yes, I worked with a fashion designer for about a year and I was actually employed. I was basically employed by the venture capitalist firm. So I was like an employee there. Um, and so I knew after about a year that I had done what I,
00:07:16
Speaker
my gifting is there, and they just really needed a maintenance person, which is great, but I'm not a maintenance person, I like to be challenged, and so I was like, I just don't know, I knew that there was something there, but I didn't know how to make that happen. At that time, there weren't, that I knew of, a lot of business coaching for creatives, or consultants in the creative world, that was totally unheard of. I mean, there was like Marie Forleo, I guess, but that's kind of all that I knew,
00:07:45
Speaker
I didn't even know much about her. So I didn't know how to do it. And I came home crying though, like every single day, I was so just like, this is not, I'm not a job kind of person. I am an entrepreneur. And so one day my husband was like, quit your job. I was like, seeing that I have hair to, and you're in school, that's not really a possibility. But I, it's funny, like many people that get into the creative world, I had done flowers for my own wedding and for some friends and I had thought like,
00:08:15
Speaker
was something I was just curious about. Maybe I wanna do flowers. I've always been a creative person and so I quit and I started, I reached out to a floral designer in Atlanta and was like, can I just shadow you? And it's funny at the same time, most people don't know this about my story, but I didn't know what I was doing. I just reached out to her, but at the same time, I was still, I also reached out to a venture capitalist firm and I was shadowing them. I applied to get my MBA at Emory in Atlanta. I was just like,
00:08:43
Speaker
throwing spaghetti on the wall. I'm not really sure what I'm supposed to do with my life, but I'm just gonna look into all these curiosity, like things I'm curious about. So starting with flowers, I knew after two weddings, I was not meant to be a wedding for us. Like, that was not my deal. But it's funny, the same thing started happening.
Launching a Consulting Business
00:09:00
Speaker
We were at the second wedding, I was driving back with my friend Amy, who's a floral designer, and I was just like, why are we, this three a.m., three in the morning, we're driving back like, can't hardly see, we're so tired. I was like, why don't you have somebody break down these events?
00:09:14
Speaker
And she said to me, I don't have money for that. Like, how do you, and I was just like that kid in my head, you know, I'm just like, that can't cost more than $150. Like, how do you not have money to pay that person? And I just started asking these questions that come very naturally to me because I'm a money person. And I always ask the questions I'm not supposed to ask, but how much money do you make and do you really make money? You know? And so I started working with her. And so I just like did flowers and did money.
00:09:42
Speaker
And I did that for a year and a half and Amy had such a big name in the creative industry. She was kind of like the original players in the wedding world and that kind of fine art world and people just started noticing. So really all my referrals were right of mouth. So I did that, started with her in 2012, but it wasn't until the end of 2013 that I officially launched my business. And that's something
00:10:05
Speaker
I think I want to share with more people and I want more people to know that I did. I threw it all on the wall. I did anything somebody would pay me to do until I figured out what I felt like worked, what I figured out how to do this thing. Sometimes I think we often like want to have a business plan. The blueprint model I teach is a business planning model.
00:10:26
Speaker
But it's like, sometimes you just have to do. And then you figure out the plan later. And so that's what I did for almost two years. I didn't officially have a business. But then I got so many calls and emails, which I'm thankful for. I was like, I guess I should figure out what this is called and how to charge for it. And so, and what I do and what I don't do. And so 2013, I officially launched Shannon Skinmore Consulting.
00:10:50
Speaker
Yeah, it's so funny for so many people. I mean, the key to getting started is just to start. And good for you. I mean, coming back from that wedding, you could have just been like, this isn't for me. And kind of shut your brain off there and not explore it any further. But then you start asking these questions. And I'm sure for you, that's the kind of stuff that's life-giving for you. And so what a perfect merge of all of your interests.
00:11:14
Speaker
So, you start meeting with those first couple clients, right? And as you start meeting with them, do you see right away like, hey, these are a couple problems that plague kind of all small businesses, maybe, or all creative small businesses when they're getting started. Did you notice a trend or common characteristics there? Absolutely. So, absolutely, hands down.
Identifying Financial Patterns
00:11:35
Speaker
I feel like that's why I was like, there's something here. Because I saw, yeah, the patterns were always the same. Most, and I'm sure a lot of people listening,
00:11:44
Speaker
Um, I would say like, why did you start your business for most people in the creative industry? It was because they wanted to create whatever their art is. Or, you know, they did again, like so many in the wedding industry, like they did paper goods for their own wedding and then are now do paper goods or, so I would say the creativity came first, the business came second. And so what I started seeing is that all of these amazing women had extremely beautiful talents.
00:12:11
Speaker
They were doing great building businesses on their, like, they were building up their brand, I guess, and brand awareness. But the patterns on the financial side and the business side were the same. A lot of them had a lot of money coming in, but it went out just as fast. So nobody, they weren't holding on to any money. And something Amy shares very openly about her story, the floral designer work group, when I met her, she had sat down with a financial advisor just maybe a month before and he said,
00:12:40
Speaker
your business is bankrupt, you need to close it down. Because of that, she had a ton of money coming in, but it went out just as fast. That was the first thing I saw. The second was there was no understanding of cost, like what truly cost is in your business. In a creative world, I think we talk a lot about price.
00:13:01
Speaker
Look at everybody else's price online and like, okay, I think this is a good number but we don't understand why the price price is all about cost and Understanding time and cost and and so that's what I saw with my fashion designer That's exactly what I saw with Amy my floral designer and every under other industry I started thinking that there is a pricing formula there really is and Because we all have costs we all have time to
00:13:28
Speaker
and we all have to account for margins. So that was another thing I saw. Another one, which is even bigger now, and we can totally talk about this, is spinning wheels. Very unproductively spinning their wheels. I always say there's a lot in entrepreneurship. There's always something we can be doing. There's always something. But it's extremely hard to sift through all the good things we can do for the great things. And I saw a lot of creative entrepreneurs
00:13:57
Speaker
we're just trying to do it all. And we're mostly multitasking, juggling, many moms, so we're working part time, or side hustlers, they still have a full time job. And it's like, it's all these things, like, nobody's making mope forward momentum, because we're trying to do so many things. So those are kind of three of the main first patterns that I was like, these are the same no matter what industry. So what if I could create a strategy and a process that can solve these things?
00:14:26
Speaker
for every industry. And that's what I did.
00:14:28
Speaker
Yeah, that's fascinating because all three of those things, I'm just shaking my head like, yes, yes, I can totally see that. Maybe we've experienced some of those as well. Even going back to the very first one, money coming in, a lot of money coming in and then money just going out. Do you see that there's common places that money goes out on? Are people just putting it back into their business? Always. Yeah. Always. So what kind of tips do you give people in like, hey, you can't just put all this back in your business. Some of this has to go in your pocket maybe.
00:14:57
Speaker
Yeah. Yeah. Well, I always say first, and I don't know if I should say it because I probably should get in trouble for saying it, but I'm always like, if you have a CPA that tells you that not paying taxes is a goal, like a good thing, like that should be your goal. Like you need to leave that CPA immediately. I have a good friend who is a CPA who would say the exact same thing. Okay. This is our disclaimer. I'm not a CPA. I've been out of the finance world for really long in that capacity a long time.
00:15:24
Speaker
I say that because and but I think a lot of us operate under that mindset and not seeing like your business money is your personal money. And so every dollar that spends I think just spending without intention and something actually I go back to my days in personal finance and for small business owners where I used to work and you know as a financial advisor I used to always say what most people need more than anything else is a budget and I think I was
00:15:51
Speaker
kind of make a joke like budgets become a six letter curse word especially to creative entrepreneurs because it feels like a no, it feels like oppressive. But so I turn that around and I call that a spending plan. We all need a plan for how we're going to spend and it amazes me that most entrepreneurs that I work with don't have it. They get this money in but they've never like kind of earmarked like where is that? I think Dave Ramsey said like name every dollar.
00:16:18
Speaker
And I love that so much because it's like, okay, you tell your money where to go and nothing that's really free. Like I have a house cleaner. I have money for, I get new clothes every three months. Like I have set aside dollars for that and not have freedom to spend it. And that's what I love about having a spending plan and something I established with every person I work with. It's like, where are your dollars going? Then you feel free and you don't feel so much guilt and shame and especially for
00:16:46
Speaker
women who maybe aren't contributing to their household and their spouses are like, what are you doing? You know, it's a great way to, how can you contribute? And I think that's where we find money they didn't realize they had.
00:16:57
Speaker
So in developing a budget, and I'm so thankful for Krista, because I love thinking about those things, you know, budgeting, where our finances are, you know, where the money is going, is going. But Krista is the one that actually has the discipline to make sure that we are following, you know, that budget. Yeah, I know that we've used a mint in the past to set our budget. Do you have a favorite money spending plan tool? And I love how you reframe that, by the way. Yeah, thank you. So no,
00:17:26
Speaker
Actually, I still am old school and pen to paper. So I wish I had brought it with me. So a few years ago, I thought it was crazy that business owners don't spend time each year to plan for the next year. And so that's something every single year in finance we did. We would get away with our little office and we would set all her goals and set our sales goal
Preference for Manual Budgeting
00:17:51
Speaker
and all that stuff. And so I kind of carried that through and I started this thing called blueprint retreat.
00:17:56
Speaker
back in, the day, actually here's a funny story, the day I launched my website, I also launched Blueprint Retreat. Like I had 200 followers on Instagram, nobody knew who I was, I'm like, I'm gonna do a workshop, it's gonna be great. But anyway, so I created this workbook though, and that's actually, so I still use it, it's called My Blueprint Year now, and I, every single month, still write out my personal budget. I tried Mint, but I just electronically was too much for me, so every year, I sit down and,
00:18:25
Speaker
And it's just an Excel document or Google Doc now and create our annual plan. Like, so I know here's the salary we're going to pay ourselves and here's all the ways that we're going to place this. We're going to put that money either monthly or annually. So we do, we have budgets for, uh, travel, clothes, you know, we have Kyle, my husband's and, um, he likes to fly. So we have like a flying budget.
00:18:50
Speaker
So we have all of that, and then I just literally every single month write it out. I love that, that's so helpful for me, just to be like, okay, that bill was paid, and check, check, check, and so I'm sorry, I don't have a great software tool, but I'm just still old school, pinned to paper. You know, I mean, what's interesting about that, and something that I think I just realized about myself in the last year is that I actually, maybe things just stick with me more when I write them down before, you know, I still, I love technology, so I use plenty of it. But even like goal planning,
00:19:19
Speaker
If I write down my to-do list, let's say, which I know to-dos and goals aren't the same, but if I write down my to-do list and then I put it into the app that I use to track those to-dos for whatever reason, it sticks with me a little bit more. So I'm sure there's something there that's helpful about writing it down. Do you have, like, is this something that you've created that you share with others? Is there a place that somebody could purchase this or get access to it or attend a retreat and learn it? That's such a great question.
00:19:49
Speaker
Last year, we made it available to all the people, all my students in Blueprint model. But this year, I'm redeveloping it because it really paired very much with the curriculum. It really wasn't a standalone product. They have to at least understand my philosophy and how I do it.
00:20:08
Speaker
But now we're working really hard this year to make it so that it's standalone. So hopefully this fall, it'll be available. Let us know when that becomes available. OK. So is there anything else about setting a budget that people should know just in terms of like where to start with all that? I think I have to have two points. I mean, the first is I see a lot of people get really bogged down in the details of it.
00:20:34
Speaker
And sometimes I always say like you want to make it specific enough where it's meaningful but not so specific that you won't follow it. And so I feel like some people I love the idea of naming every dollar but like I don't we have a cash spending allowance second point.
00:20:50
Speaker
We don't track how much money goes towards groceries, towards eating out. I don't really care. I don't, that's way too detailed for me. But we have a monthly, we do, I mean, I'm sorry, a weekly, we do $260 a week for Kyle and I, if that gets anybody a reference point. We don't have any children. So $260 a week. And that's where we get, that goes for all of our spending. If I want to go to Target or something, you know, it's just that's, we get, we also do personal.
00:21:17
Speaker
Like, I get money from that, Kyle gets money that we don't ask each other how that's spent, and I love that. I mean, it's like 10 bucks a week. I think we started like $5 a week, and I used to go to the gas station and get myself a Diet Coke, which I don't drink anymore, which is sad, which is good. But it doesn't even matter how much it is. So that's something I want to say. Don't get so detailed that you won't follow it. And we don't track what I love about the cash, the weekly cash spending.
00:21:46
Speaker
If people are familiar with Dave Ramsey, I think we do it very differently with that. That was a little, I've never actually even read, I don't even know the whole Dave Ramsey process. Total money makeover, I think. Yeah, I don't know how all that works. But I do love having a weekly cash amount. So I always say I don't care where it goes. I just care that I only spend $260 a week. So that's really great for us. So I say don't get too bogged down. And just how much is coming in, where is it going, and just have a plan.
00:22:16
Speaker
Yeah, I think one of the adjustments we made, you know, since college, I think right when we got married right out of college, we tried to be so specific about everything. And, you know, that inevitably leads to failure, and then it inevitably leads to an argument, you know, and then it inevitably leads to just not doing it at all. So I 100% agree with that. And that resonates with me for sure.
00:22:39
Speaker
So transitioning to point number two, you were talking about the pricing
Understanding Costs and Pricing
00:22:43
Speaker
formula. I have a feeling that you're going to solve a lot of people's headaches right here. So how should a creative entrepreneur price their services? What does that formula look like? Yeah. So it's kind of just like I say with the budget, I do a budget reverse. I start with your need first and then work backwards to your sales goal or what your salary is.
00:23:07
Speaker
I do pricing the exact same way. I believe we can't know anything about a price until we know cost. And so the first recommendation I would make to everyone listening, he was like, how, so when I, let me give this into like a story, right? When I worked with my fashion designer, she only worked with silks and silks are a very extensive product. And so she would sell her shirts for almost, some of them are almost $300. And so you would walk into,
00:23:36
Speaker
that fashion designer's shop and they're like, how is she not making profit? This shirt cost $300 and coming from somebody who wore Walmart tennis shoes on my very first day. Yeah, I didn't know. I was just like, they've got to be rolling in the money. So we always look at price and we think that it determines value or what somebody's making.
00:24:02
Speaker
But what happened was I realized it was actually her cost. It was so high. Even at $300, she never would have made profit. And that's what I see with a lot of entrepreneurs. They're spending so much. Price doesn't really mean anything. And so when we compare it to other people's price, then it really gets confusing because we don't understand.
00:24:26
Speaker
We don't understand why they price the way they do. So I say, first and foremost, sit down and figure out what your cost is. So that's material costs. So for photography, if they're film photography, if you have an outsourced editor, what are the actual costs, travel costs? Do you have a second shooter? What are the actual costs? And then also, how much time are you putting into it? So this is one of the things we never think about, because we're doing it.
00:24:51
Speaker
and we're getting paid a secondary, right? If there's leftover, I'll pay myself. But we have to think, what if you couldn't shoot that wedding? You would have to pay somebody to come in and do it. That should be calculated into your cost. And then once you understand your costs, I always add margin. And the margin is that fancy financial word, but it's just leftover. And so it's like, that's exactly my formula. Understand cost, use a multiplier to give yourself margin every time.
00:25:20
Speaker
and then you get your price. And what's great about that, and then there's this whole like, then how do you spin it? But the margin is what goes to pay you as the business owner, not just the photographer, but you as the business owner, and all the overhead. What I see a lot is that people price just to cover their cost. And they're like, okay. Or they'll like price to cover their cost and then add a little bit and feel like they're rolling in it. But the moment that they take on staff,
00:25:47
Speaker
or they need to take on staff or they need to take on rent, they get more expenses, they have to like really, really increase their prices very quickly and that becomes very stressful. And so I try to teach the idea of pricing for profit even when it feels like a lot of money. Because that's just, that is how ultimately the business has to run. One day most people will have a studio, one day most people will have staff. Whether it's a virtual assistant or not, you have to price those things in the beginning.
00:26:18
Speaker
So I think one of the most difficult parts of pricing, and you mentioned it in that formula, is pricing for time. Because, especially when you're first getting started and you're just grateful to pick up that first wedding or whatever, and you're thinking, and one of the things that we warn against is having an all-day collection. As wedding photographers, we did that where we had the unlimited collection, and that was just absolutely miserable, obviously didn't value our time. But how do you teach people to
00:26:47
Speaker
put a number on their time. I love that. I love that story so much, Davey, because I think often this is such a thing for creative entrepreneurs. We think if we give the moon, the client will realize we gave them the moon and it means more value. But in reality, that's just, I mean, I'm sure, you know, like over time you just see they don't
00:27:15
Speaker
oftentimes our clients don't really value the fact that we're spending all day with them. They don't get it because that's all they've ever known. And so it's just like, you're trying to give them this big bonus, but yet they don't really realize it. And then there's this bitterness that happens. And anyway, so the first thing I would say is always, always, always know how much time goes into something. And a lot of creative entrepreneurs don't, and I didn't either. This is something I myself didn't, didn't know. And so I'm a big advocate of tracking time.
00:27:45
Speaker
I use a free app called toggle, T-O-G-G-L. Do you know toggle? It's the best. Yeah, so we brought on my sister. She's working for us now, and she uses toggle to track her time. It's so great. And I know that's a whole different conversation. How do you track your time when you're working on multiple projects? So don't get too, everybody listening, don't get too crazy on that, but we just need to know how much time actually goes into a project. It's not just the amount of time you're at the wedding.
00:28:10
Speaker
It's the editing time, it's the prep time, it's packing your gear, it's actually booking the client. And so I think it's really important to understand just even three projects from start to finish, how long does it take? And then I always say you actually are two different people, okay? So stick with me for a second. You are first, I'm gonna say you wear two hats and you should get paid for two hats. So the first hat is the photographer hat, the actual creative role that you're doing.
00:28:39
Speaker
This, when you're starting out, anybody starting out, I would say you need to kind of price your time as the amount it would cost you to replace yourself. So, and I get that that's hard, like nobody can paint that painting or shoot just like you, but if you had to hire someone, probably 20, $30 an hour, depending on location could be up to 50. That's where you kind of start as an hourly rate. You just need to know again, like what is the cost?
00:29:05
Speaker
That worker bee has to be replaced if you can't do it, right? And then you also should get paid later as the business owner. And that comes in with the whole margin. So yeah, when you're thinking about time, I think the biggest thing is understanding how much time goes into a project. And then I just say calculate what it would cost you to actually hire somebody to replace that and start there.
00:29:26
Speaker
I wish somebody had told that to us when we first got started. For real, I think it would have saved us a lot of headaches, for sure, when we first got started. I think we think getting paid is a luxury, and if there's leftover money, then we get it. But we have to realize, maybe as the business owner, that's a luxury. Maybe the business owner gets paid from leftover, but you always are doing the work, and you have to get paid for that work.
00:29:53
Speaker
So the last thing that I want to talk about in this point is margin and what exactly margin means, you know, except there's probably a bunch of people out there are like, I don't, you know, I don't know. It sounds like margarine. I don't know. I don't know what I don't know what any of that, that means. So could you unpack what that, that looks like? Yeah, absolutely.
Concept of Financial Margin
00:30:09
Speaker
I had a friend tell me one time, she was like, I, when you say margin, I think of Microsoft words, like a setting on Microsoft word and I'm like, get it. Absolutely. So margin is a fancy financial term, but I just think of it as white space.
00:30:22
Speaker
the leftover. You can think about this with your time, with your money. In all areas, I say there should always be white space. In finance, the margin is the difference between your price and your cost. It's the leftover amount. There should be leftover because that money is then spent for overhead and salary and all those extra things that we think, again, sometimes as luxuries, but
00:30:50
Speaker
So margin is just that leftover space. And I say that margin should be 60% of your price. So if anybody listening is out there like, give me the number, I say 60%. I don't know, that's just through, I don't even know how that happened. It's funny, people ask me now like, did you come up with that? And I'm like, I guess I did. That used to be like a Shana thing. But I've been, you know, through 12 years of finance, I've now seen that work through every industry.
00:31:20
Speaker
industry, creative industry in one way or another. The only time that that's different for anybody listening who's like, that doesn't work for me is usually in the art world or anybody that's doing wholesale retail. Because there's like an art world, galleries typically already take 50%. So there's just nothing you can do about that. But for most industries, it's about 40% cost 60% margin. And that margin goes again to pay for salary and overhead and
00:31:49
Speaker
actual money left in your business. It's not getting the weeds, but they're just to be leftovers. I would love to see people get to 60%. It's like if you priced at $1,000, it shouldn't cost you more than $400.
00:32:07
Speaker
Yeah, and what you're saying about white space, I feel like this is the perfect transition just to pause because I want to get to, you know, problem number three that people often fall into, which is doing everything themselves or doing too much. But before we get there, you take a sabbatical.
00:32:23
Speaker
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Speaker
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00:33:29
Speaker
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Taking Breaks for Deep Work
00:33:41
Speaker
Yeah. And what you're saying about white space, I feel like this is the, uh, a perfect transition, uh, just to pause, cause I want to get to, uh, you know, uh, problem number three that people often fall into, which is doing everything themselves are doing too much. But before we get there, um, you take a sabbatical every year, right? And so that, that do you recommend that for everybody? That's such a great question. Um, yes, I do. Yeah.
00:34:08
Speaker
Yes, the answer. I've never been asked that point blank like, do I? But absolutely I do because I believe I think it was Henry David throws that you can't hear music and noise at the same time. And I think for me, when you have your head down and you're just doing all the things you have to do, and especially now in our world, it's very like inundated with noise or social media, a lot of interaction with people.
00:34:37
Speaker
it becomes very hard to do like true deep work, you know, that counting for like deep work. So absolutely, I do transform my business and also it's just fun. So yeah, absolutely. No, I think I think rest just in general is so important. And I can tell one of the one of the difficult transitions from being primarily wedding photographers to now we're doing, you know, the heart of our business is Davey and Krista custom branding and design, you know, everything that comes with that.
00:35:06
Speaker
was that we would work all week and then potentially shoot a wedding and then so our weekend's gone and you just feel drained when Monday comes around. But on weekends where we can actually rest, enjoy time with each other, go see friends, Monday looks a lot different and the same is true I think from just going on a long vacation. If you can get away, if you can get out of your office even for two weeks, for me, I find that by the end of that two weeks,
00:35:33
Speaker
Um, I'm rested, but then also like, you know, day 11, 12, 13, 14, I'm actually looking forward to getting back in the office and tackling whatever projects that I have, you know, laid out and set before me. So I love that you take a, um, a sabbatical and that you've built a business that allows you to do that because your sabbatical is what, four to six weeks usually. Yes. Yes.
00:35:55
Speaker
Yeah, that's incredible. To get to a point in your business where your business allows you to do that, I think, is just the dream. Absolutely. It's totally possible for everyone out there. I do want to talk a little bit more about that, but moving on to that last point. You had mentioned that last pitfall is people taking on too much? Yeah, kind of spinning wheels, not knowing where to put their focus.
00:36:23
Speaker
So how do you deal with that with people? Yeah. So, um, I would say like I come from a numbers background. Um, so I naturally go to numbers first, right? So a marketing person is going to go to marketing first. A tech person is going to go to technology first. I think, um, like your solutions here, right? So I don't want to say this is the end all be all, but for me and most of my clients at this point, I've worked with over a thousand entrepreneurs and
00:36:53
Speaker
I mean, I should just really count it up, probably double that. And I've spoken to, you know, and I mean tens of thousands of people, which is pretty amazing. And what I've found is that I call them, I call these like numbers to know. And I think that what I see a lot is that so often we're focused on activity, but we're not focused on outcome. And so when I worked in finance, we, every single week, we had a meeting with our office and we had to track like,
00:37:23
Speaker
how many phone calls we made, how many meetings we had, how many asks, like how many time we asked people about. So we called it activity, right? So it was like all this activity. And we reported every week our activity to our team. And so I always found that my activity was always lower than everybody else, but my outcomes were just about where everybody else were higher. And so I started thinking about how does this relate to the creative world and how can we find, I think there's always that call them the should do. So everybody knows that we can just list them off
00:37:52
Speaker
We should have an email list. We should post on social media three times a day at these segments. And we should, we should, we should blog. We should, we should, we should, we should. And we get so caught up in the shoulds. And we're only one person. Most of us don't have teens. And so it's like, how do we do all these things? So I started focusing on how can you cut that clutter and focus on if you want to make money in your business, what are the things that make money? How can you book those 10 clients?
00:38:19
Speaker
And so I just started, I called them like numbers to know and focusing on like your sales school. What is your purpose this year? And when you know that it allows you to say like, that's a good thing. That's not a great thing for me. Um, so for an example, one of those things for me was social media. Last year I, about a year ago, I decided that I was going to take a year long break from Instagram and Facebook. Um, I called it my social media experiment. I documented the whole thing to see what happened and, um, because
00:38:49
Speaker
I started realizing this felt too important for my business.
00:38:53
Speaker
And I'm not a marketing person. I've never been taught anything about marketing. So I love that you just have brands that book like, I don't know. I don't know anything about branding. Well, it's a testament, I think, to how much you've helped people and how much you've served people that people keep on talking about it. And you still, even not being on social media, have an online presence, whether you're even aware of it. I don't know. And it's so funny. I think this goes really good to this point. There are some things, and that's different for everybody.
00:39:23
Speaker
This is different, right? I can't tell everybody what it is. But like there are some things for me that was like, how can I get in the heads of the people I'm working with? And if I can keep getting in their head and keep providing solutions, then I don't have to just like be in their face all the time. I can just do good work and let the referral, you know, hopefully let the top keep growing. So that's why I thought I'm going to go on social media and see what happens. At that time it did not be brought in about 95% of
00:39:50
Speaker
traffic to my website so that was a dumb idea but it worked and so I think for anybody listening like you think the first thing admitting like we can't do it all so if we can only do a few things really well what are the things that are moving you towards your goals and towards that outcome you're looking for and sometimes that means giving up what other people say is a really good thing and I've just learned like I said I go off the grid and
00:40:17
Speaker
six months at a time. I'm just like, I can't handle it all. I haven't written a newsletter in three months. And I feel bad for that. I'm like, darn it, I could be doing so much more, but I'm just like, no, this is, I need to focus and these are my priorities and that's what I give my attention to.
00:40:32
Speaker
I feel like there is an analogy there even with money. When we first started our business, I remember we got paid for $400 for our first wedding and thought, wow, if we could only charge $1,000 and we could do 30 of them a year, we're going to make $30,000 and we're so excited about that.
00:40:52
Speaker
And we've come so far since that, we're charging more than $1,000 per wedding. But it's funny, at nowhere, it's so easy along the way to realize an extra $30,000 a year at one point would have been just so incredible, right? But then when you just don't notice as you surpass that,
00:41:16
Speaker
All of a sudden, it's not enough anymore. I think it's easy to get in that scarcity mindset like, oh, I just need to go in and do more.
Psychological Aspects of Money
00:41:25
Speaker
How much of having a healthy money mindset do you think is psychological? Oh, all of it. Or just perspective, yeah. Every amount of it. I love how you said that because enough is a moving target. I think the only way
00:41:44
Speaker
to feel content is to stop the target. And to say like, this is my goal. And with that goal, I am doing X, Y, and Z. And that is enough. And I think enough, enough's my favorite word. And I think enough has somehow gotten a negative connotation. Like it's enough, like I'm surviving. But I don't think of it that way at all. I think enough is like, this is our need. This is what we have to have. And it's doing all these things because
00:42:15
Speaker
One thing I don't think anybody's really talking about until you get to that point is like, enough is a moving target. I used to think, I mean, I remember praying every single month, like, I don't know how we're going to make our bills this month. Like, but somehow it always came through, you know, and Colin, I, he used to work at the airport and he would get to, he worked at like a private airport. So they would give tips. That's like how we bought our groceries, you know?
00:42:40
Speaker
And now, we've been so blessed, funny and silly, I'm so thankful for that. But it's funny, I still sit and I'm like, okay, I could do this, and I could do that, and all of these ideas. And ideas are great, but it's like, what is the trade-off? And sometimes we have to say, this is enough, because that gives us freedom, gives me freedom, to not go pursue all of those things at once and just be exhausted. My friend told me the other day, she was watching an interview with Martha Stewart, and I'm just holding onto it.
00:43:10
Speaker
Martha Stewart at the time was 75 years old. And this person said to the interviewer, said to Martha, like, um, when are you, you should do this or when are you going to do that or something like that? And again, 75. And she said, there's always more time for that. And I was just like, yes, like that is such beautiful freedom. Like I think in our very constant, very moving world, we think if we don't do it now, we're never going to get to. I think that way too. I still think that way.
00:43:37
Speaker
And, um, but what gives me peace is like, we have enough. We have enough right now to stop working for the rest of the year. And that's what gives me freedom to get to do that. And it's like, but I will never be content if I don't let that be enough.
00:43:50
Speaker
And I think that listening to the advice that you preach, actually writing things down, setting a budget, really takes away some of that anxiety. Because we have sales goals, for sure, for Dave and Krista. We have goals around that kind of stuff.
00:44:09
Speaker
But at the end of the day, if there's a near miss or there's a miss, I can look at our budget and say, hey, we're paying our bills. We can pay our mortgage. We have a roof over our head. And so actually writing those things down and actually spending the time, even though that money just can be overwhelming, taking the time to go through that kind of stuff definitely curves the anxiety when you get in that mindset of, I don't have enough. Or look at what everybody else is doing. They seem to be
00:44:36
Speaker
making so much more money or whatever lies that they are that you're thinking. Yeah. It's so much freedom, I think. It's freedom to know, to me, I always say you need to know at least your bare minimum. I do a need, a want, and I call it no bounds, but need, want, no bounds. And I set goals that way, which is really cool to be an entrepreneur and be like, if we do this, we can do all that. But what's wonderful and what's beautiful is if I need to rest, I feel okay with that because I know what we need.
00:45:05
Speaker
I love how you said that. We're very intentional with the way we spend. I think if I could leave everybody with nothing else, I want to say wealth is not about how much money you make. It's about how you spend the money you make. When you know that, it gives a lot of freedom to rest and say, we can pay our bills. I know how we're going to do that. You don't have to strive so hard.
00:45:29
Speaker
That's awesome. I'm so excited for people to hear that. So two scenarios I want to talk about real quick. If somebody is starting a business or they're in the beginning phases, maybe they're still working a full time, nine to five corporate world, but they have this interest in floral design or whatever it is, where should they start with money? Yeah, just I mean, where should they start? I think the biggest is I'm always surprised to know how many new business owners are
00:45:59
Speaker
All of us, all of us don't have a sales goal. And a sales goal is just saying like, how much do I want to sell this month, this quarter, this year? So for anybody that's new, I think this is a really great place to start because it gives you a target to shoot for. And it's like, okay, if I want to make $10,000 this year and I'm charging $1,000 a wedding, I need to book 10 weddings. How can I find 10 people that I can work with?
00:46:28
Speaker
And it breaks down something that feels daunting into something that's more bite
Setting Sales Goals for New Business Owners
00:46:34
Speaker
-sized. And so like, okay, I know I can get, that's one client off my list. Okay, now book two, now book three. And so knowing, especially if you're trying to leave a job, knowing what is the number that allows you to leave. And oftentimes I want to challenge people, it's not always the money you're making. That's a big misconception. What do you need to leave? What do you have to have?
00:46:57
Speaker
And then how do you start there? Because just like for us, it took me almost two years to really start my business. And I'm so thankful. I did everything and anything I could to make that money, but I knew what we had to have. And that's a really, I think it's like when it's a little workout class, you can do anything for 30 seconds, right? It's like if you know when the end is, you can keep pushing until you get there. So you kind of make that target, I guess.
00:47:25
Speaker
Yeah. Amy and Jordan said something similar about when they were working towards, you know, leaving their business, they knew there was going to be a season of hustle. They knew I'm not leaving their business. I'm sorry. As they were starting their business and they were leaving their teaching positions, they knew there was going to be a season of hustle, but they knew that it was temporary. And they had a very clear plan of what it would take for them to go full time in that business. And I think that made all the difference. And as I interview different people, you know, those people with a plan like that seem to
00:47:53
Speaker
They seem to reach their goals. They seem to get out of that working a nine to five and that side hustle at the same time. And faster. Yeah, and faster. And the second scenario I want to talk about is somebody who has a business. Maybe they're in that situation and they have a lot of money coming in and a lot of money going out and they just feel like,
00:48:12
Speaker
It's hectic. They can't do it on their own. What are their resources they can turn to to get their stuff together so that they're not anxious about money or worrying about whether their business is going to be in business next month or next year? Yeah. Well, first of all, I feel very called to help that person. I hope over the next few years to continue making resources.
00:48:41
Speaker
There aren't a ton of great, this is why I'm one of the reasons I'm so passionate about this. I don't think there's a lot of resources out there that talk to us, that talk to people that are creative, maybe have a different goal with money and business. But I would say the very first thing I would say is awareness is the key to change. And so if you really don't know where your money's going, I just encourage people to print off their bank statements for the last three months
00:49:11
Speaker
and just sit down and take a look. Because oftentimes, I've done this for years with my clients many times at Starbucks, so everyone listening is lucky, I'm not taking them to Starbucks. There's a lot of tears and a lot of why, like people just, how did I make so much money and not keep any of it? And I think the biggest is just look where your money is going and then say like, is that where I want it to go? Do I want to spend
00:49:40
Speaker
I don't know, I spent $1,000 in a month on eating out, $500 on Starbucks. I was like, that's crazy. I love a good Starbucks, but nobody needs that much coffee. And so just like there's little tweaks that you can make just to say like, where do you want your money to go? And there's probably a lot more opportunity there to hold on to it than we think. So just take a look. Yeah. So you teach about all this stuff.
00:50:10
Speaker
You have the blueprint model. What are the different aspects of that? If somebody's saying, if somebody is listening to this and they're like, I need that in my life and business right now, how do they get connected with you? What are the various forms? I knew you have a retreat. Do you have more, not interactive, rather, electronic, digital, do you have a course that people can go through? Yeah, so all that I offer right now as we speak, but hopefully will change soon.
00:50:39
Speaker
All I offer right now is the blueprint model and the blueprint model is a 12 week coaching program and it's in January every single year and it's basically a strategy program based on my philosophy about business which is business built for life. It's the idea of understanding our finances from a perspective of most people that I work with don't want to build multi-million dollar empires. They want to make six figures and go home and be with their kids. So it's kind of that philosophy about business
00:51:07
Speaker
And it's, it works through three stages. It talks about the strategy of our business. Like what do you want your business to be like? Because I think that's really important and a step most people don't think through in the sense that like all of our businesses aren't going to look the same because we have different goals. And so it's like the strategy of business. Then I talk about systems and operations where we really sift through that clutter. And then the last is all my philosophy about money and you get
Blueprint Model Program Overview
00:51:33
Speaker
I created a financial toolkit with how do you track your income, how do you understand where you're spending, creating a spending plan, sales goal, all that stuff. So that's what I do every single year. And then every year I have a conference for those students called Blueprint Summit, and that's in November. But I would actually love, Davey, what I would love is anybody can go to my website, chanaskimber.com and email me, what are their biggest pain points about money?
00:52:00
Speaker
And as a financial, because I would, I don't think there's a lot of financial education for creative entrepreneurs, and I would love to, as a former financial advisor, start talking more about that. So when I was at personal, is it business, is that holding on to your cash, is it creating a spending plan, what are their pain points, and then I would love to hopefully get to solve some of those needs in the next few months or next year. And I think the other person would maybe be Christy Wright, I think. I don't know Christy, but I think she does work with
00:52:28
Speaker
primarily women-owned small businesses as well. So she's a Dave Ramsey person and she could be a great resource as well right now since I don't have anything right now. And speaking of your website though, there is a great tool on your website, right, that people can go on. It's a quiz. Tell us about that. Yes. Okay, so it's a quiz called the Focus Finder. And my goal on that was I get emails basically daily. I don't right now do one-on-one coaching because I have hundreds, almost 500 students right now. That is incredible. I'm my blueprint model, which is crazy.
00:52:58
Speaker
So I'm pretty full, like, loving coaching them. And so I don't do any one-on-one coaching. And the reason is I wanted to create a baseline that everybody, as I was getting the same question. So go through the blueprint model, then we can coach. So I was like, how can I coach people without getting on the phone with them? So I developed this quiz with my brand designer and website developer. And we developed this quiz. So it's five questions, and it determines your stage in business.
00:53:26
Speaker
And from there, it gives you the three things you need to be doing right now in your business. So it's called the focus finder. And why I love that is because it sifts through all the really good things and it tells you the three essential things you have to do in your business. Whether you're a dreamer, so I call it in the weeds or the hustler, the growth mode. So this is the person who's wanting to scale up, build their team. And then the last one's the scale out phase out. So this is the person who's built it, done it. Now they want to like an exit strategy. So there's four phases and it tells you like,
00:53:56
Speaker
Okay. Based on these five questions, where, what phase you're in and here are the three essential things that you should do next. And so it's kind of my way of coaching had hundreds, thousands of people take it at this point. And, um, it's really cool cause they get this whole like laid out all the resources, blog posts, some free stuff, some purchasing stuff. Like it's really great.
00:54:17
Speaker
Okay, awesome. And so you also, and you blog, I see you post blog posts fairly regularly. So that's definitely a resource for people to check out. Head on over to your website. That sounds like the best way to learn more about you. And I think, you know, if you are struggling with something financially,
00:54:34
Speaker
taking you up on that offer to email you. Do it so that the best possible resources are created for the specific issues that you are facing right now. I want to thank you so much for taking the time to share your expertise. I am so excited for people to listen to this interview because I think it's just full of practical advice that I wish that I knew back when we were first getting started back in 2010. So thank you so much for joining us.
00:55:03
Speaker
Davey. Yeah, thank you so much for asking me. It was awesome to spend time with you. Thanks for listening to the Brains That Book podcast. If you enjoyed this episode, please consider subscribing to the podcast on iTunes and leaving a review so that others are more likely to find it. For show notes and other resources, visit DavianChrista.com.